JOHOR BAHRU – The subsidies for eggs and chickens amounting to RM528.52 million throughout the implementation period of the Keluarga Malaysia Price Control Scheme (SKHKM) announced by the government last February would no longer be relevant for the farmers.
The situation is caused by the continuous price hike of chicken feed following the Russia-Ukraine war which has driven the commodity price of grains to spike to an unexpectedly high level.
According to a source, the price of chicken feed had rose from RM1,700 to RM1,800 for each tonne metric compared to RM1,400 in August last year.
The RM1,400 was also the 70% increment from the RM800 per tonne metric earlier.
Although this price hike scares the local farmers, but they have expected the situation as the relationship between Russian and Ukraine has been stiff prior to the war.
In addition, Russia and Ukraine produce one third of the world’s grains.
“When there is a war, the price of grains would definitely increase, thus, it gives impact to the price of chicken feed. The price hike in chicken feed means that the operational cost for the farmers would increase.
“A kilogramme of live chicken requires 1.78 kilogramme of chicken feed and a mature chicken weighs around 2.5 kilogramme,” he told MalaysiaGazette.
He said, the farmers and breeders had informed the Ministry of Domestic Trade and Consumer Affairs (KPDNHEP) about their concerns, hoping that a better approach can be taken to achieve the win-win situation between the farmers and the government.
Although there are subsidies, the continuous price increment trend of the chicken feed had caused the return of the burdens suffered by the farmers earlier.
“Thus, our question is, until when can the government afford to give subsidies to the consumers as it involves a huge sum. Isn’t it better to spend the subsidies allocation for the hardcore poor group?
“The prices of chicken should be determined by the market price as no one can predict what would happen next,” he explained.
According to that source, the situation is not an exceptional case as the whole world is facing the hyper-inflation situation.
In the United States for example, the inflation leaped to 7.1% from their Gross Domestic Product (GDP) and the price of chickens there increased by 25%.
“What happens here is the same situation which happened in 1923, where the prices increased beyond control. The situation caused the situation where there is no goods to sell although the consumers have money to buy them. This is the current global situation, the food crisis is happening,” he explained.
Elaborating further, the source said that the reasonable chicken price should be RM10 per kilogramme now, compared to RM8.90 per kilogramme as set in Malaysia currently.
The price takes into consideration that the farm price is only RM6.50 per kilogramme.
He said, the RM10 is fair for the consumers and people in general.
“However, it would depend on the decision of the government. For the industry, we can only provide the best option that we have,” the source added. -MalaysiaGazette